Confidential
Published: Oct. 14, 1999 | Result Date: Jul. 19, 1999 |Case number: BC026988 – $0
Judge
Court
L.A. Superior Norwalk
Attorneys
Plaintiff
Defendant
Will Jay Pirkey
(Office of the Los Angeles City Attorney)
Facts
Plaintiff and his wife hired attorney No. 1 to represent them in the sale of their used car dealership to a buyer. The attorney representing the sellers prepared a contract without securing the contract price. Thereafter, problems arose between the parties and the buyer refused to make further payments. Later, the parties agreed to a new purchase price with the lower amount to be deposited into an escrow account. The plaintiff's attorney failed to secure the escrow funds and the buyers' estranged wife succeeded in attaching almost all of the deposited money. The plaintiffs then sued the buyer and obtained a default judgment of $369,000. The plaintiffs filed lis pendens in all counties in Southern California and a minimum asset check was done but failed to uncover any assets of the judgment debtor. The plaintiffs hired attorney No. 2 and they filed suit against attorney No. 1 for failing to secure the contract price and failing to secure the escrow funds. The plaintiffs obtained a $200,000 settlement with attorney No. 1 which left an uncollected $169,000 judgment unpaid. The insurance carrier for attorney No. 1 had conducted an asset check but found no significant assets. The plaintiffs' fee agreement with attorney No. 2 specifically excluded pursuing post-judgment matters without a contract and there was no written fee agreement regarding collection efforts. Attorney No. 2 did not engage in efforts to collect the remaining portion of the judgment. Much later, the plaintiff and his wife divorced and each received 50 percent claim to any amount collected against the judgment debtor. The plaintiff and the ex-wife then sued attorney No. 2 for failing to collect the remaining portion of the judgment. Later, the ex-wife dismissed her action in exchange for a waiver of costs. When the plaintiff first attempted to collect on the judgment by seizing the assets, the judgment debtor filed a Chapter 7 no asset bankruptcy and the remaining uncollected debt was discharged.
Settlement Discussions
The plaintiffs initially demanded $600,000 and then later made a C.C.P. º998 settlement demand for $64,000. The defendant offered a waiver of costs.
Other Information
The court granted defendant's (attorney No. 2) motion for summary judgment based on the lack of an express agreement to collect the remaining unpaid judgment and because the judgment was not collectible. The court's ruling on the motion for summary judgment occurred on July 21, 1999.
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